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BIOLASE, Inc. Message Board

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  • bacoonlt bacoonlt Mar 30, 2003 9:16 AM Flag

    almost all green

    Amiga, I don't count options as owning stock in the company and also don't think the finance companies do either. If the options expire worthless then they still have just what stock they own. They have a higher interest in the company. I'll grant you that. jmho I'm sure you'll say instead of using brain, look it up on the computer. lol

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    • My friend, not including options in your analysis of any company can be hazardous to your financial health. There has just been too much misuse of this tool in the last decade. As you say, if the options expire out of the money nothing has changed and you are right. But managements have found a way around this by doing what is called "re-pricing" which they do at the new lower stock level, in effect voting themselves a bonus for poor performance. BLTI management has never done this and I would doubt they ever would but nothing prevents it. There was a great article last week by the Chairman of P&G who suggests all options should be for restricted stock only. I heartily agree. Two of the power trading companies voted themselves huge option packages just before their stock tanked and these are now having to be paid out of bankruptcy. A potential option dilution of 10% is definitely on the high side. Future packages should be carefully weighed as to reasonableness and stock type. There is also some chance that options may be required to be expensed. Coca-Cola and several others have already proceeded down that path and it may just be a matter of time. Regards, HP

    • Make a suggestion. That might actually help somebody.

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